Product market regulation, innovation, and productivity

Abstract

Several recent policy and academic contributions consider that liberalising product markets would foster innovation and growth. This paper analyses the innovationproductivity relationship at the industry-level for a sample of OECD manufacturing industries. We pay particular attention to the vertically-induced in ‡uence of product market regulation (PMR) of key input sectors of the economy on the innovative process of manufacturing and its consequences on productivity. We test for a di¤erentiated e¤ect of this type of PMR depending on whether countries are technological leaders or laggards in a given industry and for a given time period. Contrary to the most widespread policy claims, the innovation-boosting e¤ects of liberalisation policies at the leading edge are systematically not supported by the data. These …ndings question the relevance of a research and innovation policy based on liberalisation.

Rent Creation and Rent Sharing: New Measures and Impacts on Total Factor Productivity

“…A few studies find the opposite results. Amable, Demmou, and Ledezma (, ), for example, find that anticompetitive regulation can have a positive impact on TFP growth in industries close to the technological frontier or even in all industries. More specifically, they find that the distance to the technological frontier could increase when there is less regulation.…”

Product Markets’ Deregulation: A more Productive, more Effcient and more Resilient Economy?

“…Nicoletti and Scarpetta (2003) show that, in manufacturing, the gains are greater the further a given country is from the technology leader, via improved incentives and opportunities to catch-up with the frontier. Amable et al (2016) argue that the effects may even turn negative for the highly productive, which face higher uncertainty and lower incentives to engage in disruptive innovation. Autor et al (2016) also fnd a negative relation between competition and patent production.…”

“…incremental innovations with lower impact on productivity or cost reducing measures such as reducing wage costs, e.g. via relocation; Amable et al, 2016). Also, it may reduce available funding, given the negative impact of competition on the value of frms' pledgeable assets, thereby acting as a drag on innovation (Petropoulos, 2017).…”

“…Nicoletti and Scarpetta (2003) and argue that deregulation is actually increasing with the distance to the frontier, as enhanced competition creates the incentives for laggards to catch-up. Amable et al (2016) argues that the impact is negative for the highly productive, given the reduction in mark-ups. In the same vein, Autor et al (2016)…”

La consolidación del mercado interior de servicios. Un reto irrenunciable para la economía de la Unión Europea

“…En todos ellos es posible observar una pauta más constante de la evolución de la productividad en la UE frente a los saltos de la productividad de EE UU. 2 Calculada como valor añadido bruto a precios constantes entre personas empleadas. Se recogen tasas de crecimiento anual.…”